According to reports, the Nigerian government will soon approve legislation recognising the use of Bitcoin BTC tickers down $16,685 and other cryptocurrencies as a means of keeping up with “global norms.”
The story was first revealed by Nigerian-based publisher Punch Newspapers on December 18 following an interview with House of Representatives Committee on Capital Markets Chairman Babangida Ibrahim.
According to the report, if the Investments and Securities Act 2007 (Amendment) Bill is passed into law, the Securities and Exchange Commission will be able to “recognise cryptocurrency and other digital funds as capital for investment.”
Ibrahim emphasised the need of Nigeria staying up to date on capital market trends and developments:
“Like I said earlier during the second reading, we need an efficient and vibrant capital market in Nigeria. For us to do that, we have to be up to date [with] global practices.”
The report comes almost 24 months after Nigeria banned crypto activities in February 2021, when the Central Bank of Nigeria (CBN) ordered crypto exchanges and service providers to Nigerians to halt business and order banks, close the accounts of any person or entity found to be doing trading.
But Ibrahim, who was Nigeria’s president from 1985 to 1993, insists that passing the law is not a 180-degree inversion of the ban, but rather a secondary review of what is within scope of the CBN powers:
“It is not about [the] lifting of the ban, we are looking at the legality: what is legal and what is within the framework of our operations in Nigeria.”
“When cryptocurrencies were initially banned in Nigeria, CBN found that most of these investors were not even using local accounts. They therefore do not fall within the CBN’s jurisdiction. Since they don’t use local accounts, there is no way for CBN to verify them,” he explained.
If the bill passes, the Investments and Securities Act of 2007 in Nigeria would be amended.
The bill will specify the Central Bank of Nigeria’s (CBN) and Securities Exchange Commission (SEC) (Nigeria) regulatory functions on topics connected to digital currencies in addition to assignment of legal recognition to Bitcoin and other cryptocurrencies, according to the report.
The eNaira, the digital currency issued by Nigeria’s central bank, has received little to no attention from Nigerians and only has a 0.5% adoption rate as of October, 12 months after its launch.
As adoption grew after the ban in February 2021, the Nigerian government’s earlier efforts to suppress cryptocurrency activities may have also been fruitless.
Nigerians only behind the United States in Bitcoin trade volume from January to August of last year, and at that time, they were more likely to google “Bitcoin” than people from any other nation.
An April research report by CoinGecko revealed that Nigerian citizens were the most interested in cryptocurrencies. The curiosity is understandable given Nigerians’ ongoing efforts to combat soaring inflation and economic distress.
Nigeria also began initial talks with cryptocurrency exchange Binance in September to develop a cryptocurrency-friendly economic zone that aims to support cryptocurrency-related businesses and blockchain in the region.